Jones Faces Copyright Infringement Lawsuit
By Bill Hughes
MURRAY, KY - Murray businessman Chuck Jones has been named in two more lawsuits and a restraining order, in the aftermath of his departure as CEO of several textbook-related companies earlier this year.
Jones is a defendant in a lawsuit filed Thursday in New York's Southern District Court, which alleges he is guilty of copyright infringement. The plaintiffs are two of the world's seven biggest publishers, Pearson Education and McGraw Hill Education.
Other defendants in the case are James W. Byars, Mark Peebles, Eduardo Rivadeneyra, and Tom O'Brien. Businesses named include C.A. Jones Management Group, College Book Rental Company, Southeastern Book Company, Excess, Blackrock Investments, Inter-Express Forwarding, and Accu Copy.
The specific details of the case are not yet known. An attorney for the plaintiffs, Matthew J. Oppenheim of Oppenheim, Zebrak, LLP, in Washington, D.C., responded by email and said, "The publishers are very concerned about the issues that are raised in their suit, but at the moment are not commenting beyond what they have already said in their legal filings."
Pearson Education is part of Pearson, the world’s leading publisher, with 41,000 employees in 70 countries. In addition to textbooks, they have a strong consumer publishing arm with Penguin Books as the main brand. They also publish the Financial Times newspaper. Pearson generated $8.4 billion in 2011, and their worldwide headquarter is in London.
McGraw-Hill Education is the 7th largest publisher in the world, based in Columbus, OH. They generated almost $2.3 billion in 2011.
The restraining order was issued Thursday in Calloway Circuit Court, and forbids Jones or his wife, Sarah, from involvement in College Book Rental Company or its assets.
This comes less than a month after he stepped down from day-to-day operations of CBR, along with South Eastern Book Company, Book and Bean, and Integrated Computer Solutions. That announcement Aug. 30 came shortly after he was named in an $11 million lawsuit by Planters Bank in Hopkinsville for breach of loan agreements.
The restraining order was signed by Judge Dennis Foust, and referred to previous lawsuits as it alleged that there were numerous problems at CBR related to inventory.
Chuck and Sarah Jones were named in a fraud lawsuit in February by Chuck's Nashville business partner David Griffin, but that lawsuit was settled out-of-court when Myles MacDonald of the Nashville-based Kraft CPAs Turnaround & Restructuring was named to manage the companies after Chuck stepped down.
As MacDonald began that work, he found the inventory problems and met with Security Bank and Trust to discuss loan obligations. The Murray Ledger and Times reports that during those talks, he learned of another business, Global Book Resellers, which Jones controls, at least partly.
Bank officials said they ordered a book from GBR on Amazon.com, and the book they received had a fixed asset number from CBR. The complaint alleges that Chuck Jones took international editions of CBR books, had them rebound as U.S. editions, and then sold them from GBR.
The retraining order says CBR would likely suffer immediate and irreparable injury without it, along with a temporary injunction.
On September 4, McGraw-Hill and three other education companies settled copyright and trademark infringement suits totaling $2.6 million with book distributors in California, Texas, Florida, and Akansas. Investigations prior to those lawsuits revealed a large wave of counterfeit books being distributed, apparently from a supplier overseas. The plaintiffs, also represented by Oppenheim, said they were pursuing action against other companies engaged in similar practices.
Lawsuits, of course, give only one side of a case.